Exxon Expands Drilling

According to a March report from Bloomberg News, oil industry giant Exxon Mobil Corp. (www.exxonmobil.com) plans to spend about $100 million a day for the next half decade as it drills previously unreachable oil and natural gas deposits.

Exxon Mobil has budgeted $34 billion for capital projects this year, a 5.6 percent increase from 2010, and as much as $37 billion annually through 2015, Chief Executive Officer Rex Tillerson said.

Exxon Mobil is awaiting U.S. regulatory approval to drill two wells at its deep-water Hadrian discovery in the Gulf of Mexico, the company said. Work on Hadrian was interrupted after the fatal explosion at BP’s Macondo well in April 2010 prompted the government to halt all exploration drilling in waters deeper than 500 feet.

The company is spending more as it expands drilling in geologic formations previously regarded as impenetrable and as it upgrades refining and chemical plants in Asia to supply the world’s fastest-growing energy markets. “The step-up in capital spending is almost entirely due to the level of spending we put towards unconventional,” Tillerson said.

Exxon Mobil expects to boost oil and gas production by as much as 4 percent this year, the company said. Eleven new projects are scheduled to begin pumping oil or gas between now and 2013.

Exxon Mobil Corp. (www.exxonmobil.com)

May 2011, Related Perspective – Government Policy Handcuffs Oil Industry
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